David Cameron delivered his long-awaited speech on immigration last week, proposing to limit EU migrants’ access to the welfare system for their first 4 years in the country. Cecilia Bruzelius, Elaine Chase and Martin Seeleib-Kaiser point out that there is a lack of clear data informing the debate on immigration and that there is little acknowledgement of the fact that the UK’s welfare state has become semi-sovereign post-European integration.
Last Friday David Cameron presented proposals to limit EU migrant citizens’ access to welfare and tax benefits. These proposals are part of a long public debate about the alleged ‘costs’ of EU citizens for the public purse, public services and the labour market. However, the data are insufficient to make any strong claims about benefit reliance or social service usage. Moreover, the weakness of the UK state to effectively implement EU regulations is a core factor relevant to – yet largely missing from – the current debate.
Semi-sovereign Welfare States
Previously national welfare states have become semi-sovereign through European integration; they can no longer limit service provision and consumption of benefits to their own citizens and territory.
Since the EU’s inception, European integration has aimed to achieve the freedom of movement between member states of goods, services, capital and workers – it was always intended to be more than purely a trade bloc. Key elements of EU governance and competencies, which, it is claimed by some political actors, Britain did not sign up to when she joined in the 1970s, have in fact been in place since the very beginning of the EU integration process. Over the years, significant progress in specifying the principles of freedom of movement and non-discrimination for migrant workers has been made through rulings of the ECJ. Moreover, through the establishment of European citizenship with the Maastricht Treaty in 1992, and the principles of freedom of movement and non-discrimination, the coordination of social security is no longer limited to economically active persons and has also been extended to include non-contributory social security benefits, for which EU citizens are eligible according to the same conditions as national citizens.
The idea of ‘semi’-sovereignty appears to be in conflict with traditional understandings of parliamentary sovereignty in Britain, as clearly expressed in Cameron’s speech. The changes proposed by the Prime Minister would demand the amendment of Article 45 of the Treaty, in effect the cornerstone of the EU, which stipulates equal treatment of foreign and national workers.
‘Burdening’ EU citizens – claims without evidence
Despite contrary research evidence and the lack of any robust administrative data, it is surprising that EU migrant citizens are increasingly portrayed to be a ‘burden’ on the state purse. Even the Home Office recognises the lack of data in its delayed report:
We do not record the nationality of benefit recipients at present but are working to improve the data available and have published estimates of the number of migrants accessing benefits using national insurance numbers linked to benefit administration data. With the introduction of the Universal Credit, the Government is looking to routinely collect more robust data on the nationality and immigration status of claimants on benefit payment systems (pp. 39).
However, estimates based on the UK Labour Force Survey suggest that EU migrant citizens are much less likely to be claiming benefits than British citizens (Figure 1). Moreover, according to research by Dustmann and Frattini, EU migrant citizens contribute a significant net fiscal benefit to the public purse in the UK.
Figure 1: Per cent of the Working Age Population Claiming Benefits
Contrary to the claim of ‘benefit tourism’, the overwhelming majority of EU nationals enter the UK to work. In 2013, 67% of EU migrant citizens stated that their main reason for coming to the UK was for work related reasons (compared with 22% for formal study and 8% to join/accompany a family member). Of those who came to work, around 60% had a definite job and 40% were looking for work (HM Government 2014: 33). There is, in other words, no available evidence that access to benefits is a significant factor in influencing migration decisions (ibid: 40).
The alleged cost and drain to the English National Health Service is another area of contention in the debate on EU migration. However, the cost-benefit ratio is far from clear and it would seem plausible that the contributions by EU migrant citizens outweigh the cost, as they tend to be younger than the average British citizen. Moreover, the NHS has directly benefited from intra-EU migration, as the significant domestic skill shortage has been partially compensated for by EU immigration (see also the work by Brad Blitz). Also, as large numbers of British citizens retire in countries where the average cost of healthcare is lower, such as Spain, this is very likely to have resulted in a net gain for the exchequer (HM Government 2014: 50).
Furthermore, it is argued that it is much easier for EU migrant citizens to access benefits in the UK, for instance compared to France and Germany, as the British welfare state is largely non-contributory and also provides in-work benefits. This argument is flawed. Although Germany’s welfare system is widely based on the principle of social insurance, it does indeed provide access to a number of benefits, very similar to those in Britain and unrelated to social insurance contributions.
State capacity and implementation of EU regulations
European welfare states are dependent on strong state capacities to deal with the complexities of intra-EU migration. A precondition for being able to plan effectively is the availability of accurate data, knowledge about the rules governing freedom of movement and associated social rights, and state capacity to implement, and comply with, the relevant regulatory framework. By contrast, a lack of knowledge and state capacity to enforce EU regulations can lead to strains on welfare state budgets and misrepresentation of the causes of such strains.
Undoubtedly, specific local authorities in Britain (as well as other countries) are challenged by the arrival of higher numbers of EU migrant citizens requiring benefits and social services than in other areas. Responding appropriately to these new demands requires the national government to provide additional support to those local authorities receiving comparatively high levels of resident EU migrant citizens so that they can make the necessary planning and infrastructure changes required to accommodate them.
Robust data about benefit receipt and the use of social services by EU migrant citizens can help local authorities plan more effectively and provide guidance for resource allocation from central government. Based on a comprehensive review, the German Federal Government has for example recently pledged to provide more than €200 million in additional funding, financial resources from the European Social Fund (ESF) and the Fund for European Aid to the Most Deprived (FEAD), for affected local communities. By contrast, the UK government has not allocated any funds from the ESF to specifically target local authorities in England that are struggling with pressures on public services as a result of intra-EU migration.
It also seems urgent to provide extensive training and the necessary infrastructure to enable service providers to effectively apply EU regulations. A recent study commissioned by the Department of Health in England, for example, highlights the lack of knowledge among healthcare professionals within the NHS regarding the eligibility for free medical treatment. This has significant implications for the public purse, as considerable amounts of money are seemingly not claimed back from EU citizens’ countries of origin, as should be the case under reciprocal arrangements for care across borders.
To sum up, before proposing measures that are unlikely to be supported by all European Member States or threatening to leave the EU over the assumed impact of EU migration on the public purse and public services, the UK government would be well advised to collect more systematic data, seek to improve the implementation of EU regulations and provide support to affected communities by allocating additional national and European resources.
This piece will also be published in a longer version on Social Europe. The text is based on research funded as part of the FP7 project bEUcitizen by the EU Commission (grant no 320294). The authors thank Thees Spreckelsen for his support in analyzing data.
Note: This article gives the views of the authors, and not the position of the British Politics and Policy blog, nor of the London School of Economics. Please read our comments policy before posting. Featured image credit: Thiery Ehrmann CC BY 2.0